As Joe Biden takes office as the 46th President of the United States, businesses are wondering what the change in administration could mean for their business in 2021 and beyond.

For manufacturing, an industry that has endured a roller coaster ride over the past 12 months, there are many potential items on the agenda of this administration that could dictate how the next 12 months play out.

One such item is the Made in America executive order signed by President Biden on Monday, January 25, which imposes tougher rules on government procurement practices to increase purchases of products made in the U.S., a step toward fulfilling his Buy American campaign promise.

This first step, combined with President Biden’s expressed plan to make a $400 billion four-year increase in government purchasing of U.S. made products and services, as part of his Biden clean energy and infrastructure plan, will power new demand for American products, materials, and services and ensure they are shipped on U.S. flagged cargo carriers.

In addition, as part of a plan to Retool and Revitalize American Manufacturers, the administration is proposing a 10% surtax on imports from offshore business activity and 10% Made in America tax credit to incentivize onshoring.

What does it all mean? Speaking at ENGAUGE, Ryerson’s digital conference hosted on January 21, Alan Beaulieu, PhD, the president of ITR Economics, said that President Biden plans to focus strongly on the U.S. and in doing so will provide businesses with more opportunities. But those opportunities could come with some caveats.

“What this is telling us is that he is serious about building onshore activity, and if you are an onshore producer you will find yourself in a great place,” said Beaulieu. “However, if you are heavily dependent on offshoring, what that is telling you is that costs will be going up and you may want to ready to find some onshore sources.”

Ryerson recently surveyed its customers on this and other potential items on the agenda of the new administration. Buy American ranked third in terms of importance, behind Section 232 tariffs (will they be repealed?) and the U.S.-global trade agenda.

Overall, when asked whether the new administration would have an impact on their business in 2021, most respondents (42%) were uncertain. However, of those who had a strong feeling on the matter, 33% anticipate the Biden Administration could hurt business with only 12% believing it could help their business—with 13% anticipating no change.

Chart on left shows what respondents said about what the new administration could mean for business. Chart on the right asked respondents to rank the potential impact that items on the agenda of the new administration could have on business from 1-5 (1 having the biggest impact)

 

Complete results of the Ryerson customer survey, The Metal Perspective 2021, will be released on February 1.

 

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